Is Title Insurance Mandatory in Ontario?

June 5, 2025 | Buying a Home

When buying or selling a home, we tend to get caught up in our thoughts and visions of the future. A new neighbourhood and house awaits, and it’s exciting to see where life will take you.

Amid the flurry of packing, moving, and unpacking, the finer details of a transaction can get left to chance if we’re not careful. In this post, we’ll talk about some of the questions you should be asking about title insurance.

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What Is Title Insurance In Real Estate?

Title insurance protects your right to your property title. It’s something every homeowner needs but almost no one gives it a second thought. Fire and theft insurance are easier to understand because of their physical nature.

The title of your property isn’t something physical you can see or touch. Instead, it’s a concept. All the same, your home is likely your most valuable financial asset, and the title is what gives you ownership of it. It is critical that you ensure that the transfer of ownership is free and clean from any encumbrances, boundary disputes, easements, and other issues that could affect your enjoyment of your property and its value.

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What Does Title Insurance Cover (Ontario)?

Fraud is one of the foremost issues in this digital age where some transactions are completed almost entirely online. When you think of identity fraud, you likely worry about someone opening a credit card in your name. The thought of a fraudster getting a hold of your house title and selling it from underneath you probably doesn’t come up. Until now, of course, but don’t hate us for putting the idea in your head.

The value of good title insurance is that it protects you so you can keep not worrying and enjoying your home without a care. In the rare event that you become a victim of real estate fraud, you have ample protection and representation under the law.

Fraud may be the most dramatic problem, but it only scratches the surface of what title insurance covers. However, any number of hidden flaws could arise even after you’ve owned the property for years.

These could include liens and encumbrances, invalid deeds, or even clerical errors or improperly filed documents. Rare issues are not always easy to find, and even experienced real estate lawyers occasionally miss them during the closing process.

How Much Is Title Insurance (Ontario)?

Unlike most types of insurance, title insurance is a one time premium that is usually covered with the rest of your closing costs. Specific dollar values will range, but it could be as little as a couple hundred dollars up to $1,000 depending on the value of the property. That said, this is not where you want to start pinching your pennies.

Enhanced coverage can provide peace of mind for as long as you own your home, and it is worth it to pay a little more for a high quality policy. Think of it another way. You’re buying a house in Toronto where the average price is around $1 million. The cost of a comprehensive insurance policy is minimal compared to the level of protection you it offers.

Is Title Insurance Required?

Legally, title insurance is not required. However, most mortgage providers will insist on it before authorizing your loan. While title issues may be rare, they do happen, so we would never recommend a buyer decline the option.

How To Get Title Insurance Ontario

If you have a good real estate lawyer, you don’t have to worry about where to buy title insurance in Ontario. Most of the time, it’s included in your closing package. However, that saying “trust, but verify” particularly holds true in this case.

Be sure to ask your lawyer if insurance is included and whether it’s a base or top-of-the-line policy. Doing due diligence during each stage will help you avoid unpleasant surprises along the way.

How Does Title Insurance Work?

Since title issues are conceptual, it can be hard to imagine how insurance can be beneficial. Let’s use a couple of examples to illustrate why you might want to make an investment.

In one case, you’ve bought a house where the previous owner failed to pay one of their utility bills, which results in a super priority lien against the property. This means the property owner is affected, not necessarily the person who caused the problem.

You haven’t done anything wrong, but you’re the one on the hook. Unfortunately, you also decided to forgo title insurance upon buying the house. You’re the one who has to pay the bill, which can be a financial loss at a time when you can afford it the least.

Scenario two is exactly the same, but with one major difference. You have title insurance. Upon receiving the notice, you connect with your real estate lawyer, who works with your insurance company to resolve the issue.

The insurance company may cover the cost directly or instruct you to pay it and they reimburse you. Either way, you are not out of pocket.

How Long Does Title Insurance Last?

If the lender requires you to have title insurance, there are two versions available.

Owner’s Policy: This policy protects you as long as you own your home. It may even extend to your heirs.
Lender’s Policy: This version protects the lender’s interest. Coverage ends once your mortgage is paid off in full.

The lender will almost certainly require a lender’s policy before releasing any funds. However, it’s likely worth it to purchase both versions to ensure coverage lasts for the entire duration of ownership.

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How Do I Know If I Have Title Insurance?

If you’re not in the market for a home, you may still wonder whether or not you have title insurance, especially after reading a post like this one. The easiest way to find out is to closely examine your closing paperwork from when you purchased your house. Next, look for a document labeled“ Title Insurance Policy.”

If you’ve located the document, check to see if you have a lender’s policy, owner’s policy, or both if applicable. Alternatively, you can contact your lawyer to be sure. If no policy can be found, it’s a good idea to look into purchasing one, even if it has been several years since you purchased your home. It’s a small, one-time price to pay for lasting peace of mind.

Our West Toronto Realtors® are happy to guide you, whether you’re searching for your next home or selling your existing house. Contact us today at 416-788-1823 or email kim@kimkehoe.com to learn more.